Avoiding War in the Arctic: A Two-Step Solution

Avoiding War in the Arctic: A Two-Step Solution

Jacob Loel

The Arctic Circle is home to vast energy resources, some 4 Million people, Chinese investments, and significant Russian military buildup. In choosing a path for the United States in the Arctic, it is important to consider the situation in the Arctic with a historical perspective and through the lens of the Russian economy. Many are suspicious of Chinese investment in the Arctic, but any nefarious designs China may have for the Arctic can be headed off through shrewd diplomacy. To maintain peace in the Arctic, the United States should promote international trade in the Arctic, especially with Russia while simultaneously incentivizing growth in the American Arctic. The biggest threat to peace in the Arctic is not Russian military buildup, nor Chinese investment, but Sino-Russian cooperation and coordination in the Arctic and across the Eurasian continent. 

Assessing the Threat from Russia

There has been some concern over Russia’s military buildup in the Arctic, and for good reason. This buildup is not insignificant, with new airfields throughout the country and a new Northern Command which manages two Arctic brigades.[i] This is coupled with the world’s largest military base in the Arctic, Arctic anti-ship missile systems, and plans to build the world’s largest icebreaker fleet. [ii]

This buildup should not be met with too much fear or overreaction. For one, Russian military capabilities in the Arctic were in disarray before this restructuring.[iii] More importantly, Russia is not the threat the Soviet Union once was. Both Western analysts and Russian leaders know that the economy is oil-dependent and is struggling to operate at full capacity due to outdated energy extraction equipment.  

Russia’s interest in the Arctic is quite understandable. Murmansk has some 300,000 residents, while the near-Arctic city of Arkhangelsk has even more-about 350,000. Concern for the well-being of 650,000 citizens is understandable, especially when considering that the Russian economy recovered from near economic ruin on the back of its energy industry. The oil-dependent country is sitting on an estimated 52% of all undiscovered oil, gas, and natural gas liquids (NGLs) yet to be found in the Arctic.[iv] Even before these resources are discovered, an estimated 20% of the Russian Federation’s entire GDP comes from the Arctic, which makes up some 22% of the country’s exports.[v] The Northern Sea Route (known as the NSR) is becoming more navigable each year due to changing ice formations and improved icebreaker technologies. In 2017 for example, 9.74 Million tons of goods transitioned along the NSR.[vi] Given the economic value the NSR provides Russia, it should come as no surprise that Russia hopes to keep the NSR under its control.

Russia’s interest in the Arctic can also be looked at through a historical lens. By reading the various speeches of President Putin and former President Medvedev, and by interpreting the recent foreign policy actions of Russia, one can surmise that Russia’s primary goal in the Arctic is not some nefarious world domination, but rather re-establishing a Russian sphere of influence reminiscent of the pre-Soviet Russian empire. In many ways, Russian aspirations in the Arctic are as much about national pride and heritage as they are about geopolitik and economic growth.

Considering the economic hardships which threaten Russia if they do not have a robust and consistently growing energy export sector, it makes sense that the country is growing its military presence in energy-rich areas of their country. For this reason, it would be a mistake to interpret this military buildup as a direct threat to American interests.

While Russia should be monitored, the United States should not rashly react with violence against this military buildup. If the Russian government were to disobey international law in the Arctic, the United States has the capability to use its economic power to cripple the Russian economy.

Assessing the Threat from China

Like Russia, China should be watched carefully, but if the United States were to react violently at this point to any Chinese actions in the Arctic, it could be a tragic mistake. China likely has more sinister designs in the Arctic than any other country, but at this point they should not be considered a major threat.

In 2018, China released its first Arctic Strategy, a move which itself should raise eyebrows. China has observer status in the Arctic Council, describing itself a “Near Arctic State”. This is clearly nothing but rhetoric-The Chinese border is some 900 miles from the Arctic circle at its northernmost point. The country clearly has future plans for the Arctic, envisioning a sort of “Polar Silk Road”, a goal which has already received some hundred billion dollars.

Up to this point, China has not flaunted any international laws governing Arctic affairs, and has offered Arctic communities significant investment into infrastructure. Not least among these is investment into the Yamal natural gas exporting terminal in Siberia. 20% of the Yamal Plant is owned by CNPC, China’s national gas company, while the Chinese government’s “Silk Road Fund” owns another 10%.[vii] Nevertheless, much of Chinese investment in the Arctic has been blocked; most Arctic countries are suspicious of too much investment into territory, with the exception of Russia. The fear, held by the United States and other Arctic countries, is that China will eventually use its investments as an excuse to ignore or reinterpret the various laws and treaties which currently rule the Arctic. This fear is backed up by Chinese behavior in the South China Sea, where it has flaunted maritime law. This pattern is not unique to the Arctic or the South China Sea. China is also investing heavily in Africa, where it owns about 20% of all debt. In Africa too, the Chinese are investing billions into roads, railways, mines, and ports. The Chinese already have huge sway over African countries, where there are vast natural resources. Chinese investment in the Arctic appears to be repeating this same pattern.  

This being said, China does not yet have a firm foothold in the Arctic. Given China’s disregard for the rule of law, as well as their general apparent power-hunger, it is in the best interest of the United States to ensure that China does not gain influence in the region. This is best done by incentivizing Arctic countries to not allow Chinese investments.

How to React

There are two ways which the United States could react. The knee-jerk reaction of some would be to try to out-invest China in the Arctic while simultaneously sending troops to the Arctic to counter Russian military buildup. This would be a terrible mistake. It would be incredibly costly, political unpopular, and at best, a diplomatic mess.

Assuming the United States is committed to maintaining peace in the Arctic, which is in their best interest, a two-step solution is necessary. First, the United States must build up more residential settlements in the American Arctic. Second, the United States must extend an olive branch to the Russians by minimizing sanctions and promoting trade. 

It would be a mistake to alarm the Russians with a quick and unprovoked American military buildup in the Arctic. It would be wiser to encourage population growth in the American Arctic through incentives; major tax breaks for businesses which employ citizens living above the Arctic Circle, investing in infrastructure, technical colleges, and other ways to improve the quality of life of those living above the Arctic Circle. It can also be achieved more naturally, by implementing a pro-natalist tax plan in the state of Alaska, and for the cities and towns above the Arctic Circle. This could be achieved by following the example of Hungary, whose pro-natalist policies resulted in a significant jump in the total fertility rate, or by following the example of the near-Arctic village of Lestijärvi in Finland, whose pro-natalist policies have resulted in a near doubling of the birth rate from 2013-2019 when compared to the seven years before the policies were put into place (2006-2012).[viii]

By building up the extremely minimal populations of the Arctic United States, the American government will in time have the justification for more active duty military, military reserves, and National Guard active in the Arctic. This incremental approach to military buildup will keep Russia’s Arctic military forces in check while not alarming them.  

Russia needs investment and trade partners, which is why it has turned to the Chinese.  Some countries simply are not interested in doing more business with Russia than necessary. Others are interested but are unwilling because of various American sanctions. The United States should be steadfast in enforcing sanctions in general, but I would argue that enforcing sanctions to the extent that Russia must turn to China for business is too far. Consider that if China and Russia were to cooperate in a strategic partnership, the United States would significantly lose influence, allies, and trading partners in geopolitically important countries throughout Eurasia. In other words, largescale Sino-Russian cooperation could significantly make the world more beholden to China, and thus entirely less democratic.

The geopolitical situation in the Arctic is not dire. By recognizing that the true threat comes from a Sino-Russian partnership and not from Russia alone, the United States can look ahead, avoid rash decisions, and ensure that they are promoting peace and stability with their allies.

End Notes

[i] Pezard, Stephanie, “The New Geopolitics of the Arctic: Russia's and China's Evolving Role in the Region”. Santa Monica, CA: RAND Corporation, 2018. https://www.rand.org/pubs/testimonies/CT500.html.    

[ii] Pezard, Stephanie, “The New Geopolitics of the Arctic: Russia's and China's Evolving Role in the Region”.

[iii] Pezard, Stephanie, “The New Geopolitics of the Arctic: Russia's and China's Evolving Role in the Region”.

[iv] “Arctic Oil and Gas”. Ernst & Young, 2013. https://www.safety4sea.com/wp-content/uploads/2014/09/pdf/EY-Arctic_oil_and_gas.pdf.  

[v] Ingimundarson, Valur. “The Geopolitics of Arctic Natural Resources”. European Parliament Directorate-General for External Policies, 2010. http://www.europarl.europa.eu/RegData/etudes/divers/join/2010/433791/EXPO-AFET_DV(2010)433791_EN.pdf.

[vi] Pezard, Stephanie, “The New Geopolitics of the Arctic: Russia's and China's Evolving Role in the Region”.

[vii] Bourne, Joel K. “See Russia’s massive new gas plant on the Arctic coast”. National Geographic, 2019. https://www.nationalgeographic.com/environment/2019/03/sabetta-yamal-largest-gas-field/.

[viii] Vehviläinen, Jenna. “Does it Make Sense to Pay People to Have Kids?”. BBC.com, 2019. https://www.bbc.com/worklife/article/20191017-does-it-make-sense-to-pay-people-to-have-kids